Economists say keeping Rimsevics in his post will promote stability.

  • 2007-10-31
  • Staff and wire reports

RIGA - The Latvian parliament is expected to vote as early as this week on whether to extend the job of current Bank of Latvia chief, Ilmars Rimsevics, for another six-year term. Economics experts have praised the bank governor's performance and are urging that he remain in the post to continue his work.
Economist Uldis Osis said that, by and large, he can offer a positive assessment of the performance at the Bank of Latvia. He noted that the central bank has been mainly analyzing economic processes, making forecasts and issuing warnings, and focusing less on regulatory activities, since Latvia's national currency, the lat, is pegged to the euro, leaving little room for monetary policy initiatives.
In Osis' opinion, so far Rimsevics' work at the helm of the Latvian central bank has been successful and he sees no reason to replace him. "There are few people in Latvia with such an extensive macroeconomic knowledge," he quipped.

Andris Vilks, chief economist of SEB Unibanka, said it would be an affirmation and guarantee of Latvia's stability if the head of the central bank continued in his present post. "Any talk about a replacement would only increase speculation and [add to] worries that the banking policy might change," he said. He added that delays in confirmation for a new term only add to speculation on the issue, and don't help Latvia's image or macroeconomic environment considering the current tense economic and political climate in the country.
No alternate candidates have so far been put forward by Latvia's parliament, and time to do so is running out fast. Media reports have tipped Edmunds Krastins from the ruling People's Party as a possible candidate for the central bank's head.

New Era party leader Krisjanis Karins considers Rimsevics "very competent" and has said that the Bank of Latvia under his tutelage is seen as "an institution with one of the best reputations in Latvia." He said he would be very surprised to see the ruling coalition nominate any other candidate.
Karins adds that Rimsevics has "as a priority worked to keep the stability of the Latvian currency, and that a change of governorship would send a bad signal" to the financial markets and the public.
A budgetary committee is reviewing the appointment on Oct. 30, with the final decision to be taken by a parliamentary vote.

Rimsevics has pursued two goals as governor, to bring Latvia closer to introducing the euro, and to maintain a balance in the country's macroeconomic development. Rimsevics himself has said he'd like to continue for a second term.
Rimsevics was elected Bank of Latvia governor on December 20, 2001. Previous to this post he worked as the central bank's vice-governor.